In vertebrate early development, the neural tissue is specified along the antero-posterior (A-P) axis by the activity of graded patterning signals such as Wnt, Nodal and FGF. Attenuation of these signals has been shown to play critical roles in the determination of anterior neural region, but it remains poorly understood how FGF action is counteracted in the neural plate. Here, we show that BMP signal acts as an antagonist of FGF signaling for AP neural patterning in Xenopus embryo. During the neurula stages, BMP signal Was up-regulated in the anterior neural plate, displaying a graded pattern along the AP axis. Inhibition of the late BMP signaling after mid-gastrulation abrogated the expression of anterior neural markers. We found that BMP signaling interfered with FGFs-induced ERK phosphorylation and neural caudalization. This inhibitory action of BMP signal involved repression of the expression of Flrt3, a positive regulator of FGF signaling. Furthermore, the gain- and loss-of-function of Flrt3 inhibited and expanded the expression of forebrain marker genes, respectively. Together, these results demonstrate that BMP signal can down-regulate FGF pathway via inhibition of Flrt3 expression for anterior neural formation, revealing stage-specific roles of BMP signaling and its novel crosstalk with FGF pathway in neural development. (C) 2013 Elsevier Inc. All rights reserved.